Niche Software at Its Best

Deltek has dedicated itself to one primary industry with many sub-groups: project-oriented business solutions for contractors and consultants. Originally known for its government contracting expertise, Deltek has expanded its product line to include several different enterprise resource planning (ERP) solutions to serve project-based businesses in different niches, and has created a leading position in additional sub-markets.

Deltek Vision, released in 2002 as a fully web-enabled product serves the professional services automation (PSA) market. The solution offers users all of the features they might require to manage the entire project life cycle from client acquisition and retention, to proposal generation, to project planning and management to billing and finally to back-end financial management.

Deltek and Deltek Vision have been successful because the company and product are focused on very specific market segments, offering users the technology, terminology, and functionality required only by the market segment.

Company History

Founded in 1983, Deltek (http://www.deltek.com) has expanded from its government contracting roots to compete in several allied markets. Revenue growth has been steady and significant, with 2004 revenue reaching $122 million (USD) and a 20 percent growth rate. The majority of growth in 2004 came from new customers.

New Mountain Capital purchased 75 percent of Deltek's shares in 2005 to recapitalize the company and allow it to further expand its product line, develop a broader channel particularly overseas, gain market share through significant increases in marketing programs, and continue its investment in technology.

In June of 2005, Kevin Parker, former co-president and chief financial officer (CFO) of PeopleSoft joined Deltek as its chief executive officer.

Core Product Line Summary

Deltek Enterprise, also known as Costpoint, is aimed at large organizations that provide project-oriented services as well as businesses that perform discrete manufacturing or build-to-suit project manufacturing. Currently serving 1,000 customers, Deltek Enterprise provides a complete range of application suites including customer resource management (CRM), financials, time/expense, resource and project planning, human resources (HR) and payroll, business process management (workflow and alerts), business performance management (business intelligence and planning solutions), and materials management.

GSC Premier, which serves approximately 1,200 government contractors, has similar functionality, and can leverage Deltek's recently released GovWin application, which manages complex government contracts. GovWin can also be used in conjunction with Deltek Enterprise.

Deltek Vision

One product in particular warrants further discussion: Deltek Vision. Released in 2002, Vision replaces to some extent earlier products serving the same PSA-focused market. Version 4 is scheduled for release in Q2 2006. Currently, Vision supports 800 clients and there is an additional 5,800 customers on Vision's predecessor products.

Deltek Vision is a fully integrated, browser-based solution designed specifically for professional service firms. Fifty percent of its customer base is comprised of firms with fifty or fewer employees. Deltek's target market is 100 percent small and medium businesses (SMB) with revenues from $2 million to $200 million (USD).

Deltek created Vision to meet the ERP needs of project-based professional services firms, including consulting firms, IT service system integrators, and architecture and engineering firms.

To better meet the needs of its target market, Deltek has identified three key challenges for PSA firms that it claims its products help them address:

* How to win new and repeat business
* How to improve project performance
* How to maximize project margins

Vision can be thought of as two suites of applications, both of which are fully integrated. The business management functions are aimed specifically at the PSA market and include Vision Dashboard, CRM, proposal automation, resource management, project planning, time and expense management, and billing.

Its more generalized back-end accounting functions include project and financial accounting, purchasing, inventory management (with version 4 is due out in the second quarter of 2006), human resources, multicurrency, reporting and configuration.

What Makes Deltek Vision Different

Because Deltek Vision has been designed from the ground up to serve the needs of a very specific market, the menu system reflects the typical project life cycle: marketing and client/project acquisition; opportunity management; proposal creation (including government proposal); project setup (including automatic conversion from opportunity to project); resource management which includes sophisticated resource definitions (people and outside consultants primarily); search capabilities to identify those resources a specific client or project requires; resource scheduling; and finally resource tracking and monitoring.

Deltek Vision also includes time and expense input and reporting, project planning, scheduling, management and budgeting, project billing, and business management control (accounting and financial reporting).

The solution does not compete in other markets, and has been architected to meet very specific requirements in a few selected fields. Project planning is fully integrated with accounting and supports a multilevel work breakdown structure, as well as sophisticated revenue and profit forecasting. In addition, Vision's project oriented CRM includes a robust proposal automation application.

Another notable feature is Vision's user interface (UI) and Vision Dashboard. Both are completely customizable Web pages. The UI acts as the portal through which all employees interact with the system. Even though these are Web pages, they have been designed to look and act like standard windows forms. Vision Dashboard contains as many dash parts (graphs and other data) as the user requires. As additional dash parts are added, the web page expands supporting automatic vertical and horizontal scrolling. Users can, for example, add different variations of a chart that shows data sliced in different ways or they can add multiple contact lists that represent different sort or select options. Standard user-defined menu options are displayed on the left-hand side of the screen, while key financial indicators (data as well as graphs) are displayed in the center section of the screen. These indicators can be modified to fit the needs of each user. The right-hand column displays alerts and workflow tasks and activities.

Vision CRM

Completing favorably with products such as Pivotal and SalesLogix, is Vision CRM, and its strength lies with the fact that it has been created specifically for project-driven businesses in terms of both functionality and language. It includes marketing and business development, client and prospect contact management, opportunity tracking, activity scheduling, and proposal development and tracking. Like many other CRM systems, Vision allows users to create additional tables and fields to suit their unique requirements.

On of the ways Vision separates itself from the competition is through its proposal automation suite. This unique subset allows users to create effective graphical proposals with content that addresses the prospect's specific requirements.

Users create and retrieve template proposals for private sector prospects, cost proposals, and RFP responses. In addition the applications support US government forms, including the SF330 form. One of the unique aspects of the proposal suite is Vision's ability to maintain resumes of key employees that will be included in a proposal or some other communication to a prospect. Once all of this information has been created for a specific proposal, it can be exported to Microsoft Word for fine tuning and final presentation.

Project Planning and Management

The key component for any project-oriented business is project planning and management. Deltek Vision starts with the project plan and then taps into resource management to populate the project with appropriate skill sets. Its resource management module also includes skills definitions, skill searches to identify resources that can be assigned to a project, resource utilization reporting, as well as over- and under-utilization alerts.

The project plan can be created in the opportunity stage and modified until the actual project has been awarded. All costs associated with both the active project as well as the opportunity can be assigned to the project letting managers assess the entire project, not just that part associated with revenue generation.

In addition to its project planning features, Vision also supports a top down budget tool based on a flexible three-level work breakdown structure that lets managers forecast and track labor, consultants, and expenses to any level. At any point, managers can access a summary as well as details for labor, expenses, consultants, and financial analysis.

Vision's pure project management functions are straight forward and powerful, supporting everything from task dependencies, earned value tracking, profit, and revenue forecasting, and more. It is being used by firms to manage extremely complex projects. Although this suite competes very favorably with other project management products, Deltek Vision also gives users the ability to integrate with these products if they so desire.

In addition to the aforementioned functions, Vision also offers the typical time/expense application features found in other PSA-oriented products. It includes resource (time) management, as well as cost management (travel, entertainment, purchased supplies, etc.). The resource management feature allows managers to create timesheets, which can include tasks assigned to each employee, increase timesheets entry speed, and reducing input errors. Once a timesheet has been completed, it is forwarded via the workflow engine to an appropriate supervisor for approval and from there to both payroll as well as the project itself. Moreover, timesheets are auto-populated based on the projects for which the employee is budgeted, thus ensuring more accurate and efficient time collection. Other templates include Vision's billing template, which lets users create template invoice formats, assign them to individual customers, define billing rates, and compete other setup tasks before an invoice needs to be billed. Once these tasks have been accomplished, the actual billing process is far easier because the manager only has to decide what needs to be billed. Vision has segregated this complexity into the setup routines thus making the billing process relatively easy.

While its product, Vision, supports standard financial reporting, Deltek recognizes that its customers are project-driven businesses and need to integrate project reporting with financial reporting. It therefore supports profit planning and budgeting as well as organizational reporting including any defined business unit or even individual employee. Project costing and profitability can be tracked from its initial opportunity through to project's completion to give users a full view of each project and customer. Reports can even be created that identify the costs required to acquire new clients and projects.

To do this, Deltek Vision incorporates the Actuate eReporting Suite to deliver a powerful, flexible, and robust interactive reporting environment. The Actuate eReporting architecture seamlessly integrates with the Deltek Vision application, providing a completely Web-based solution that is scalable to meet the needs of the most demanding reporting requirements. Deltek Vision's interactive reporting model provides users with an intuitive, easy-to-use method for controlling the content and layout of Vision reports. In addition, existing reports can be modified and new reports can be added to the Vision report catalog.

Using the Microsoft SharePoint platform, Vision provides a robust document management system that can be accessed by employees, partners and clients. Documents can be segregated by project, employee, contact, opportunity or other key Vision record. A document can be associated with a single record or multiple records, so that it can be used for multiple projects and documents can be organized into libraries and folders and the system supports check-in/check-out capabilities to prevent two people from editing the same document simultaneously. A complete audit trail, including version numbering, is supported as are cross-document and document-type searches including Microsoft Word, Excel, and Adobe PDF.

While Vision has many notable features, its basic accounting functionality is similar to many other products, with some additional features required by project-driven businesses, specifically revenue recognition and sophisticated overhead allocation rules. Its next release will include an inventory application that is expected to close one of the gaps where Vision is not as competitive compared to other products.

Vision Technology

Vision's architecture foundation is based on Microsoft's .Net technology. The VisionXtend platform includes an integrated set of tools that allow users to customize Vision screens, automate key business processes through workflow, integrate external systems through a robust Web services application program interface (API) and extend its reach to mobile devices, third party tools, and Microsoft Office. Microsoft SQL Server is the primary database supported but Microsoft MSDE (Microsoft Server Desktop Engine) is also supported for smaller firms.

Deltek Vision utilizes dynamic hypertext markup language (HTML), which is a combination of HTML, Java Script, and document object model. This technology delivers tangible benefits to the user, such as the ability for elements of the HTML page to be modified or manipulated without refreshing the entire page to the server. This provides users with a rich environment of highly interactive features required by today's business users, ensuring that they are both productive and efficient.

Competitive Analysis

There are in fact many competing products that offer some form of time and billing. Some products concentrate only on time collection which is then imported into the main accounting system for billing. Other products combine both time collection and billing, but not necessarily resource management or project planning and project management. Finally Deltek does not compete in some markets, most notably the certified public accountants (CPA) industry, because this market requires practice management and case management, features in which Deltek has never had an interest.

Deltek Vision and other PSA-specific products address the needs of a very narrow industry niche and therefore users receive only the functionality they require or their industry demands. Many other products that compete in the PSA market also have robust functionality, but have to cater to the needs of other industries, thus forcing users to some extent to accept functions or system rules that do not apply to their industry and at times may get in the way. Even the wording and menu structure is PSA-centric while other products must be more generic (although they can be customized).

According to Deltek the following products are considered to be its main competitors:

* It Services: Epicor for Service Enterprises (http://www.epicor.com), Solomon (http://www.microsoft.com/businesssolutions/
solomon/default.mspx), ChangePoint (http://www.compuware.com/services-automation/services-automation-home.htm)

* ASP Competitors: Open Air (http://www.openair.com/index.html), QuickArrow (http://www.quickarrow.com/)

* Architecture and Engineering: BST (http://www.bstconsultants.com/), Wind2 FMS (http://www.wind2.com/)

Resellers

Most of Deltek's sales in the US are direct, although there are a number of independent resellers in the US, Australia, Africa, and the UK.

Sales and integration employees are spread throughout the country with corporate offices in Massachusetts, Virginia and Oregon (US). As Deltek expands internationally, they will rely more heavily on resellers

User Recommendations

There is no doubt that Deltek Vision is a powerful, technologically current enterprise application. Organizations that provide project oriented services should at least consider Deltek Vision, particularly if they are in the PSA market.

As is true with any other software selection project, users must consider many factors before they make a final purchase decision including required functions, ease-of-use, cost (initial investment, installation and implementation services, product customization to match a user's specific requirements, data conversion and annual support and maintenance to name just a few).

Finally users should consider the trade-off between local support that may be provided by other vendors through a reseller channel against Deltek's support that may not be geographically adjacent. This should also be balanced against the fact that Deltek will provide in most cases (remember there are some Deltek Vision resellers) direct support by Deltek trained employees.


SOURCE:
http://www.technologyevaluation.com/research/articles/niche-software-at-its-best-18188/